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Spain threatens Argentina after YPF seizure

Monday, April 16, 2012 - 02:10

April 17 - Repsol's CEO announces legal action against Argentinan President Cristina Fernandez's decision to seize the Spanish oil giant's shares in YPF. Ciara Sutton reports.

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They have enjoyed years of diplomatic friendship, but now the close ties between Spain and Argentina appear to be broken. Spain has vowed to fight Argentina's decision to seize Repsol shares in energy company YPF. Repsol chairman Antonio Brufau says the company will seek compensation for the planned takeover. (SOUNDBITE) (Spanish) REPSOL CEO ANTONIO BRUFAU, SAYING: "The Argentine government underestimates the rights and the interest of YPF's shareholders, violating once again the principle of legal safety and investor confidence. Repsol will initiate all necessary legal actions and other investors might do the same." Argentine President Cristina Fernandez unveiled her plans on Monday, saying she will ask Congress - which she controls - to approve the bill. SOUNDBITE) (Spanish) ARGENTINIAN PRESIDENT, CRISTINA FERNANDEZ SAYING: "This president is not going to respond to any threats or outbursts, or echo the lack of respect or insolent comments some have made. Because first I represent the Argentine people, and second I'm a head of state, not a bully." The Argentine government wants YPF to boost production but the company is controlled by Repsol. Share prices have plunged in recent months as speculation of a state takeover has mounted. Brufau accused Fernandez of pushing down the market value of YPF in order to secure a good deal. (SOUNDBITE)(Spanish) REPSOL'S CEO ANTONIO BRUFAU, SAYING: "Unfortunately, Argentina's president yesterday made an illegitimate and unjustifiable decision from the judicial point of view. This action was preceded by a harassment and coercion campaign." Trade partners warned the move could push the country further into economic isolation. Mexico says the plan would damage future foreign investment in Argentina and hurt Repsol - in which Mexico's oil company Pemex holds a 10 percent stake. Extreme warnings also came from the the European Commission which said the move sends very negative signals to investors. Since 2008 Fernandez has nationalised private pension funds, and re-nationalised flagship airline Aerolineas Argentinas. Ciara Sutton, Reuters

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Spain threatens Argentina after YPF seizure

Monday, April 16, 2012 - 02:10